Business Profile: Living Ventures

Having ignored most industry rules, Living Ventures co-founder Tim Bacon finds himself running one of the most dynamic food and drink operations in the country.

"I’ve been told it’s a stupid thing to say in public, but you know what, hang it. Sometimes you’ve just got to wear your heart on your sleeve and go for it.”

Tim Bacon, the boss of Living Ventures, is talking about his company’s latest project, Manchester House, which is due to get the green light on its premises any day now. To be precise, it’s just one of a handful of new plays on the cards for the Tasmanian-born entrepreneur and his business partner Jeremy Roberts, but it’s the one that has set Mancunian tongues wagging in recent months. That’s because the sole, unashamed aim of Manchester House is to bag the city its first Michelin-starred restaurant in a very long time.

“As I sit here now, the aim is to get a star,” he says. “There’s no other reason for doing it. It’s not about making money. If, in two years’ time, it’ssuccessful and profitable but hasn’t got its star then I’ll probably be going ‘hey, who needs one?’ But it’s more about extending the dining range in Manchester.”

Concepts

Giving Living Ventures’ track record, you wouldn’t bet against it. The slick restaurant and bar operator has more concepts than a Las Vegas hotel, ranging from packed inner-city cocktail destination The Alchemist and high-end pan-Asian restaurant Australasia to the Blackhouse brand of steakhouses and Italian chain Gusto, not to mention The Oast House pub, modelled on a 16th-century farm building. A Michelin-starred venue should fit in nicely, then.

“We’re not a straight up, straight down company, there’s no question of that,” adds Bacon. “We’re driven by a desire to do different things, a ‘fuck-it’ mentality. I have a fairly low boredom threshold. I couldn’t imagine anything worse than being stuck in one particular brand for five years. It becomes like work then.”

Bacon is in his year-old subterranean restaurant Australasia, in the Spinningfields business district of Manchester, picking at a plate of sushi as he talks, stopping mid-conversation to extol the virtues of the Tasmanian king fish on the menu. Friendly and relaxed, he’s evidently enjoying his time at the helm of what must be one of the UK's most imaginative restaurant groups. One thing's for sure, he isn't going to be bored any time soon.

Manchester House

Fulfilling Manchester House’s potential, for one, will keep him busy. Initially dreamt up as an ambitious 85-cover restaurant, Bacon has since revised this down to 62 covers. It is due to be located in Spinningfields, which has fast become Living Ventures’ private playground – The Oast House and The Alchemist are also there – an area that Bacon believes can become the city’s gastronomic hotspot.

The offer will be “pretty British,” low on pretension and representative of the city – “it needs to be something that sums up this area”, and to give it a fighting chance of meeting its goal, Bacon is leaving nothing to chance. The head chef, his identity still under wraps, has had ample experience of Michelin-starred kitchens, and will become a shareholder in the business as an incentive to succeed. The team is set to visit Alinea in Chicago for inspiration and the head chef will also complete a fortnight at four of the world’s top restaurants before getting to work. “As soon as we get the thing signed the chef gets locked away in the development kitchen for six months and then cooks us seven menus to try,” says Bacon. There will also be a 120-cover lounge next door, which will be both business lounge in the daytime and a laid-back cocktail lounge by night. “It’s what will keep the concept viable.”

Northern soul

For many, this alone would be enough, but it’s only the tip of the iceberg for Bacon and his team. In total Living Ventures operates 27 sites, primarily across the north of England, and has turnover of more than £40m. Its 28th site, The Botanist pub in Alderley Edge, Cheshire, opens in October and, in addition to Manchester House, two other openings are slated for the city centre. one will be a second site of its all-day dining/drinking spot The Alchemist, the first of which opened in November 2010, the other an entirely different - and still secret - concept, described by Bacon as “a large casual-dining operation in a weird location”.

Having so many different brands, and actively adding to them, might seem a complicated business model, but the breadth of offer has been instrumental in building revenue and profits across the board. The trick, he says, is to ensure no brand cannibalises the other. “I should be able to put all my brands in a line on the high street and they should all operate successfully. That’s my main criteria for development.”

Food hubs

There’s more to it than just generating numerous places in which customers can spend their wages: the varied portfolio has also enabled Living Ventures to create entire food hubs and form lucrative relationships with landlords. For instance, it is looking to add a second site to New York Street in the Piccadilly area of Manchester, to boost the Blackhouse Grill operation already there. “It was a former Heathcotes site that was doing £14,000 to £15,000 a week but we’ve managed to turn it into a business with a £1.5m [£28,000 a week] turnover. That’s all right, but it should be doing £2m plus.”

To achieve this an Alchemist is opening down the road, to draw in a drinking crowd, and a third operation will then be added. “Then people will have trust in the area,” says Bacon.

This approach has borne fruit thus far at Spinningfields. “We have a vested interest in the success of the area and so from a sales and marketing point of view we can put a lot of resource into it. If you can get a relationship with a landlord both parties win.”

Bacon now has such a close relationship with Mike Ingall, the managing director of landlord Allied London, which owns much of Spinningfields, that he was the go-to guy for its newest installation, The Oast House. Ingall had a plot of land that he needed to do something with for a couple of years prior to building an office block on it and had an idea of sticking a 16th-century oast house there.

The Oast House

It may look incongruous surrounded by high-rise glass buildings, but The Oast House has fitted in seamlessly with the rest of the Living Ventures estate. The building is part of an actual oast house found in Ireland, with the roof and wall having been shipped over and built around a steel frame.

Beer has heavy focus, with an extensive list, but many were chosen by Bacon for their lightness. “I don’t like masculine drinks and pub ales,” he says.

The 2,000sq ft unit doesn’t even have a kitchen – it has a barbecue in a wooden shack outside – but in its best week it took £125,000. “We originallybudgeted £20,000 a week. If there’s another unit that size in the UK doing that amount of sales – net of VAT – I’d be very surprised. It doesn’t do that every week: the sun was shining, which is a limited commodity in Manchester.”

Such has been the success of The Oast House that Bacon is hoping to extend its proposed two-year tenure and expand its horizons. The Botanist will draw on the concept, although it will be Victorian in design rather than 16th-century chic, and five further pubs are being planned.

Alongside that, London is Bacon’s next target. “We’ve pretty much saturated our position in the north-west, unless I can think of any more brands to do.” First up in the capital will be the relaunch of its only London site, a Blackhouse Grill in Smithfield, followed by the introduction of both The Oast House and Australasia there.

“Australasia will do well. In Manchester it did £5m turnover in its first year so it’s a strong business. Ultimately we could do two, one in the City, and one in the West End, and possibly one in Edinburgh too.” It could one day go overseas, with Sydney and New York both under consideration.

Future-proof management

The move down south will stretch Living Ventures’ resources further, but the company’s management structure has been designed to be future-proof – even when the MD seems to dream up new concepts on a monthly basis. Commercial director and co-founder Jeremy Roberts provides the financial acumen, and the company also employs two operations directors, Sue Crimes and Paul Moran, both of whom run a developed, an emerging and a conceptual concept.

In Moran’s case this is Blackhouse, The Alchemist and Australasia, with Manchester House also coming under his remit, while Crimes oversees Gusto and The New World Pub Company (The Oast House, The Botanist) and will take on the new casual concept.

Crimes and Moran deal with the day-to-day running of the businesses, but unusually not the bar and the kitchen operations. Those are overseen by a separate team, with executive chef John Brannigan, who has been with the company since 1993, in charge of the group’s entire food offer. Nothing goes on the menu without it first passing Brannigan and Bacon’s lips.

The staffing structure, and the way it runs its various operations, has no doubt helped with Living Ventures’ diverse portfolio. Its Blackhouse and Gusto (eight and nine sites respectively) are part owned by The Restaurant Group, which has a 38 per cent share in the business, and it doesn’t want to increase the number of sites further.

Expansion

Despite a lack of expansion ambition, Bacon keeps both multi-site brands fresh by actively encouraging internal competition between them. “Gusto and Blackhouse are constantly at each others’ throats, in the same way The Alchemist and The Oast House are. We have some fantastic boardroom scuffles and bloody noses – metaphorically speaking – but it’s all great fun.”

Each new concept is also treated as a way of holding on to key staff. “One of the problems of standing still in that people ask where their next move is. We’re losing good people to competitors, and nothing galls me more. I can’t change my top structure, so the only way to improve their position in the business is to grow it.”

Ultimately, the end game is to off-load Gusto and Blackhouse with future expansion funded by the new ventures. In the immediate future the business focus will be on The Alchemist and New Word Pub Company openings. “I don’t want to do 50 Gustos and Blackhouses, it would drive me insane with boredom.”

Not everything has been a success, but short-term blips just highlight Bacon’s ruthlessness — or is it impatience? Peppermint, a high-quality takeaway based on the principles of Alan Yau’s Princi in Soho, went by the wayside after just three months.

“I’m not interested in spending a year trying to make something work. The Oast House, Australasia and The Alchemist were all profitable in their first month. If people don’t get it, I’m not going to force it.”

Which begs the question, what next? “You can sit me down in 10 years and I’ll be just as enthusiastic about what’s coming up – there’s always things you want to do,” says Bacon. “It’s like a game. Who sticks an oast house in a business district? If it’s not a bit of fun, what is it?"

This business profile appears in the July 2012 issue of Restaurant magazine. To subscribe to Restaurant click here.

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